Why GFI Group (GFIG) Stock Is Gaining Today

GFI Group (GFIG) shares are climbing after BGC Partners (BGCP) announced a hostile takeover bid offer of $675 million.

NEW YORK (TheStreet) -- GFI Group (GFIG) shares are up 8.7% to $5.47 on Tuesday, a day after the stock rose 11% in trading on three times in normal volume, after BGC Partners (BGCP) announced that it is making a $675 million cash hostile takeover bid offer for the company.

BGC's offer comes less than two months after CME Group (CME) announced that it had agreed to acquire GFI in a $580 million deal.

The tender offer would pay shareholders $5.25 per share in cash, beating CME's offer of $4.55 per share.

Commenting on the CME Group deal, BGC CEO Howard Lutnik said, "The pending transaction with CME deprives GFI shareholders of the appropriate value of their investment... (It) allows GFI management to purchase the brokerage business from CME at a discount."

TheStreet Ratings team rates GFI GROUP INC as a Hold with a ratings score of C. TheStreet Ratings Team has this to say about their recommendation:

"We rate GFI GROUP INC (GFIG) a HOLD. The primary factors that have impacted our rating are mixed ? some indicating strength, some showing weaknesses, with little evidence to justify the expectation of either a positive or negative performance for this stock relative to most other stocks. The company's strengths can be seen in multiple areas, such as its good cash flow from operations and increase in stock price during the past year. However, as a counter to these strengths, we also find weaknesses including deteriorating net income, disappointing return on equity and poor profit margins."

The most recent short interest data has been released by the NASDAQ for the 11/28/2014 settlement date, which shows a 317,187 share increase in total short interest for GFI Group Incorporated , to 1,840,144, an increase of 20.83% since 11/14/2014. Total short interest is just one way to look at short data; another metric that we here at Dividend Channel find particularly useful is the "days to cover" metric because it considers both the total shares short and the average daily volume of shares traded.